AIM ImmunoTech Inc. (AMEX:AIM) Q3 2023 Earnings Call Transcript

AIM ImmunoTech Inc. (AMEX:AIM) Q3 2023 Earnings Call Transcript November 15, 2023

Operator: Hello, and welcome to the AIM ImmunoTech Quarterly Update Conference Call and Webcast. As a brief reminder, all participants are currently in a listen-only mode. [Operator Instructions] Following the presentation there will be a question-and-answer session. Note that this webcast is being recorded at the company’s request, and a replay will be made available on the company’s website following the end of the event. At this time, I’d like to remind our listeners that remarks made during this webcast may state management’s intentions, beliefs, expectations or future projections. These are forward-looking statements and involve risks and uncertainties. Forward-looking statements on this call are made pursuant to the safe harbor provisions of the federal securities laws and are based on AIM’s current expectations and actual results could differ materially.

As a result, you should not place undue reliance on any forward-looking statements. Some of the factors that could cause actual results to differ materially from these contemplated by such forward-looking statements are discussed in the periodic reports AIM files with the Securities and Exchange Commission. These documents are available in the Investors section of the company’s website and on the Securities and Exchange Commission’s website. We encourage you to review these documents carefully. Additionally, certain information contained in this webcast relates to or is based on studies, publications, surveys and other data obtained from third-party sources and the company’s own estimates and research. While the company believes these third-party sources to be reliable as of the date of this presentation, it has not independently verified and makes no representation as to the adequacy, fairness, accuracy or completeness of or that any independent source has verified any information obtained from third-party sources.

A biotechnology lab filled with test tubes and equipment, representing the life-saving therapies of the company.

Joining us on today’s call from the AIM leadership team are Thomas Equels, Chief Executive Officer; and Dr. Christopher McAleer, Scientific Officer. I would now like to turn the call over to Mr. Equels. Please proceed.

Thomas Equels: I just want to say thank you very much to our stockholders, investors and all those certified financial analysts that are attending this call. We deeply appreciate your interest and your support for AIM ImmunoTech. We have had great progress over the past 18 months. 2022 was a spectacular year in terms of our clinical development and the first three quarters of this year have been in touch with that same level of progress as we move forward towards multiple value-driving milestones. You can see what we’ve accomplished as well as what we have in front of us that we expect to accomplish on our website and also the Q we just filed lays out the clinical progress that we’ve made in great detail. I’m happy to announce — well, I’m not announcing it, just to reconfirm that we’re moving into a next phase of our business development with the addition of Azenova as a merger and acquisition business development specialists to our team.

So in addition to the clinical progress that we’re making, we’re bringing in people to help us specialize expertise to help us to move forward in oncology, especially, with big pharma. Now, the primary object of our attention, our priority drug is Ampligen or rintatolimod. Based on the extensive and consistently positive clinical progress, we’ve had to give it a priority space in our lineup. And it’s unique because it’s a toll-like receptor agonist which stimulates the immune system and has immunomodulatory qualities, but it’s very unique and somewhat rare because it does not have the systemic inflammation that other TLR drugs show. It has a broad spectrum application as an antiviral, an antitumor agent, as an immunologic modulator for immunodeficiency diseases.

So we have a lot of potential over a wide space of opportunity. Now our pipeline, and this addresses just a few of the major things on our pipeline, is extensive, and we’ve been laying down a lot of important data over the past year, data that supports the proposition that we have extremely good potential in oncology. If you look at what we’ve done historically in the early access program in pancreatic cancer, which involve both locally advanced and metastatic patients. We’re building on that with a locally advanced pancreatic cancer Phase 2 trial AMP-270, as well as combination therapy, Ampligen plus durvalumab, AstraZeneca’s drug, durvalumab. If you go to our website, you can read about the collaboration agreement we entered into with AstraZeneca, and that study should be rolling out any time now.

We’ve made tremendous progress, not just in pancreatic cancer, but also in advanced recurrent ovarian cancer and Stage 4 triple-negative breast cancer where we’re seeing dramatic clinical impacts with Ampligen. And these are in highly lethal cancers where it’s a complete — in many cases, a complete unmet medical need because there is no therapy for people once they reach this stage. Further, our work in ME/CFS and long COVID expressing chronic fatigue-like conditions is moving very rapidly as well, with a major Phase 2 where we’ve completed our enrollment. We’ve completed treatment. We’re moving forward at work speed there with expectation of data within the next six months. So the pipeline is broad. The pipeline is strong, and there are a number of other clinical trials that are underway that you can see in detail and Dr. McAleer is going to discuss as well.

So I’m going to turn it over to Dr. Christopher McAleer. He’s our Science Officer. Chris?

Christopher McAleer: Thank you, Tom. As Tom stated, we are making progress in our clinical programs, and I’d like to take a few minutes to discuss that progress in a little more detail. We are still awaiting the first patient enrollment in AMP-270. As I discussed in the last quarterly earnings call, our focus at AIM has been on recruiting and opening new sites. To that end, in the last quarter, we opened the Virginia Mason Cancer Institute in Seattle, and we also identified and contacted an additional 33 sites for a total of 103. 30 of those sites are interested in and are in some stage of the activation process, of which 18 of those sites are in the preselection visit stage. We do expect Erasmus Medical Center to be open for recruitment in Q4 and we expect to have an additional 12 or so sites to be opened in the first half of 2024.

In terms of the first patient in, the current sites are monitoring many patients, as an example, University of Nebraska is monitoring multiple patients that have recently completed FOLFIRINOX as well as Gabriel Cancer Research Institute is monitoring patients also on FOLFIRINOX. The Virginia Mason Comprehensive Cancer Center has multiple additional patients that they’re following with one potential subject coming for a follow-up visit for eligibility this month. And so, with all the initial enrollment is imminent at any point in this juncture in AMP-270, and I think with the additional sites opening in the next few months, we hope for patient recruitment to increase exponentially. Our colleagues at Roswell Park Comprehensive Cancer Center recently published a manuscript in the Journal for ImmunoTherapy of Cancer.

And some of the highlights of this data were published previously at AACR, but the manuscript provides a full insight into that study. In summary, the data shows that when patients with metastatic triple-negative breast cancer were given the chemokine modulation therapy that contains Ampligen prior to pembrolizumab treatment, they showed an increase in cytotoxic T lymphocyte markers, specifically CD8 alpha and Granzyme B in the tumor microenvironment. And the cytotoxic T lymphocyte chemotaxin, CCL5 and CXCL10, were also increased intratumorally. And so, I want you to take notice to the CXCL10 and Granzyme B as I will bring them up again when we discuss ovarian cancer. And in addition to that, the Treg markers, FoxP3 and the Treg-attracted CCL22 were not increased.

And so when you look at that ratio of cytotoxic T lymphocyte infiltrating chemotaxins and the lack of infiltration of CCL22 and attraction of Treg. The data highlights the importance of modulating cold to hot tumors. They also highlight the importance of the timing of Ampligen therapy and pembrolizumab treatment, and we are anxious to get that next phase of the trial going with a modified treatment regime. And concerning Ampligen as part of neoadjuvant treatment for triple-negative breast cancer, that data was posted to clinicaltrials.gov a few weeks ago. And to summarize the data, it was a Phase 1 trial to replace INTRON A, which was discontinued by Merck, with an interferon alfa-2b in the combination therapy, which consists of Ampligen, [indiscernible] and standard chemotherapy.

It was a dose escalation of interferon and that showed no adverse safety profile. And of the nine patients, there was a response rate of 67%. That was five complete responses, which is the absence of tumor cells, that’s 56% and a one YP thymic, which is essentially the presence of only a small number of scattered invasive cells which is considered lack of tumor, and that was 11%. And this study provides us with a unique opportunity and how we navigate that opportunity from a regulatory strategy is still being discussed. Since the approval of — the first approval of this study, pembrolizumab plus chemotherapy has replaced standard chemotherapy alone as the neoadjuvant standard of care. And that’s mostly on the back of the I-SPY 2 and KEYNOTE-522 study.

And the pathological complete response in KEYNOTE-522 was approximately 65% compared to the about 50% PCR of chemotherapy alone. And — however, that increase in efficacy comes at a substantial cost of toxicity to the patient. The incidence of Grade 3 or higher treatment-emergent adverse events was 78% in the pembro group. And those side effects of the pembro treatment are well established and for many can be harsh and really long-lasting. And so, when you look at the response rate using Ampligen-containing therapy, there is an opportunity for patients to potentially see some equivalent efficacy to the current standard of care without those pembro side effects, and how we best navigate that IND strategy is still being discussed. And so the combination of durvalumab and Ampligen in metastatic pancreas cancer, what we refer to as [durapanc] (ph) is on track to open for patient recruitment in Q4.

The largest hurdle for that was getting QP release for the European Union and import approval for the drug, which we have received. The drug is planned to be shipped to the EU this week, and it will be followed by final QP release. And based on discussions with Erasmus and their current population pool, we expect recruitment to go rather quickly. And to that end, multiple patients have already been identified for potential enrollment, and that should be up and running in the next few weeks. In regards to Ampligen for the treatment of advanced recurrent ovarian cancer, we are still awaiting the interim report for this trial from pit. However, a poster and abstract were recently presented at the 2023 SITC conference that was in San Diego and that highlights the immune modulating aspects of this therapy.

The things I want to highlight from these data are, the increase over time in the baseline value of CXCR3 ligands, that’s the top row for those that are following the presentation and the ability of these to be increased acutely after a dosing regimen. These data presented here are not unsimilar to data we have seen before using CKM in ovarian cancer. And the chemokine modulation therapy in triple-negative breast cancer. But here, that’s without the celecoxib and interferon showing that Ampligen itself is likely sufficient to modulate these properties and it can do so across multiple solid tumor types. And so broadly speaking, these data together show that this regimen is capable of creating a more hostile localized environment and that immune exhaustion does not occur.

And in addition, the heat maps, they showed — indicated that not only is there a genera localized intraperitoneal increase that we showed on the last slide in the CXCR3 ligands, there is also a chronic increase in the CXCR3 ligand gene expression in the tumor microenvironment itself. And these data again are promising because they show Ampligen containing therapies can modulate the tumor microenvironment to create a more hot tumor state. And finally, I’d like to discuss our Phase 2 study in long COVID. As we stated earlier, we have fully enrolled all subjects. The last subject’s last dose was last week. And the last subject’s last visit will occur this week. After this will be verification of source data and rectification of data with the sites, after which we — the database can be locked and the unblinding can occur and the data can be extracted.

We are hoping that database lock will occur this quarter, and we still expect to have top line data in early Q1, with full data to come sometime around the Q1, Q2 transition. What we do have currently is the safety report. And as of the last report I received on November 9, there have been over 1,600 doses administered, and that’s between placebo and Ampligen as this is blinded, with a total of 28 adverse events and no serious adverse events, which further highlights the impeccable safety profile of Ampligen. And I just read an article yesterday in Nature Medicine, which followed patients over a multiyear period, which discussed the staggering number of patients that have lingering symptoms after two years, and how potential reinfection by different variants can increase that burden.

And so, there is an extremely large market and a significant unmet medical need here. So we are advancing in our clinical agenda. And from a scientific and clinical perspective, I think stockholders should be excited about the short-term and long-term future of AIM, and potentially the patients can be excited about future therapy. And I’ll hand it back to Tom to discuss the future of AIM from a financial perspective.

Thomas Equels: Well, thank you very much, Chris. Great job articulating the clinical progress we’ve made in fine detail. And as you can see from what Chris described, we have a lot to look forward to based upon what’s happened already. And that potential and the vision of that success just is closer and clearer than ever. We have met, as you can see, the milestones that we have in Q3 successfully, and going into Q4, some of these milestones have already been met, and there are some significant ones coming up as the year-end approaches. And when we move into Q1, we’re going to have a number of these clinical trials that are discussed in Europe up and running. In pancreatic cancer we believe we’ll be seeing significant progress in the United States as well because of the expansion of the sites, and we’re expecting the data from the post-COVID trial.

So these things are all good. And I also want to mention that where we are today because of our collaborators. We have a great team here at AIM, a very committed team, but we also have been working with top-notch collaborators like AstraZeneca, Merck, the Erasmus Medical Center in the Netherlands, Roswell Park Comprehensive Cancer Center in New York, University of Pittsburgh in Pennsylvania and the Buffett Cancer Center at the University of Nebraska. And the investigators at those facilities are world-class investigators. So we’re — we got the best of the best working on these projects and helping us to move forward. And in terms of value, the COVID — the post-COVID conditions is extremely important because that’s an ever burgeoning market.

But anybody who’s familiar with deals in biotech knows the volume of deals and the value of deals is extremely high in the oncology space. And that’s why we’ve brought in Azenova to assist us with a focused outreach to big pharma in that particular space. Now for our financial snapshot, we have cash in hand with every expectation of the ability to fund ourselves through the key milestones that we’ve outlined in this presentation. As of September 30, we had approximately $22.4 million in cash and marketable investments. Our expenses are very much in line with our projections. So our ability to move forward is unimpaired and we intend to move forward as rapidly as possible with our clinical undertakings, because it is through data that we create long-term stockholder value.

So we can’t be mistaken. This is the place where the rubber meets the road in our industry. We have to continue to push and develop our data, and once we have a data set in any particular disease or as we see what — in like oncology and several different solid tumors, the value equation is driven by that data. So that’s why we have to concentrate on continued clinical progress. So you may ask yourself, why AIM and why now? And there are a number of reasons why this is a very, very important time. Our team at AIM continues to build on a solid foundation, fundamentally driving AIM forward. We have a growing body of highly encouraging positive clinical data with Ampligen in several high-value important indications of significant, often legal, unmet medical needs.

We have never before been more confident in the potential of Ampligen and our ability to work globally with regulatory bodies to ultimately bring Ampligen to patients in need. That is what drives our team at AIM every single day. We believe what we are witnessing now in our later-stage clinical studies not only gives us confidence in our lead programs, but also a line of sight into the broad utility we believe Ampligen possesses. We are leveraging the scientific and medical communities that are supported by preeminent key opinion leaders and institutions, top research institutions that play an important role in the development and the guiding light for Ampligen. We are also involved in a strategy to further engage with industry for licensing partnerships and M&A opportunities, which we believe has the opportunity and the potential to unlock significant value as we continue to expand our reach across the investment community to garner further validation and support from what we believe represents an exciting investment opportunity.

We are grateful for your time today, and we believe we are well positioned for an exciting 2024 and beyond. With that, I’d like to open up this call for questions and answers. And again, thank you very much for your consideration of AIM and Ampligen.

See also 20 Countries With The Largest Natural Gas Reserves in 2023 and 10 Best Performing Healthcare ETFs in 2023.

Q&A Session

Operator: Thank you. At this time we will be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of James Molloy with Alliance Global Partners.

Unidentified Analyst: Hello. This is Laura on for Jim. Thank you for taking the questions. So with all the clinical milestones that you have planned ahead and bringing in Azenova as well, have you seen any increased interest from potential partners? And how may do you describe, the overall current partnership environment?

Thomas Equels: Well, we’re just beginning this phase of development and outreach. The interactions in these initial stages it would be premature to make any announcements publicly regarding any talks or initial discussions. However, Azenova is a highly-skilled group with — we’re using two top people in the M&A space for oncology. So we have high hopes and reasonable, but optimistic expectations as to the progress we’ll make.

Unidentified Analyst: Got it. And then are there also any updates on your planned confirmatory Phase III trial of Ampligen for chronic fatigue syndrome?

Thomas Equels: Well, at the moment, the chronic fatigue space has been flooded with post-COVID chronic fatigue conditions. And so in focusing on our long COVID trial, we are, at the same time, I believe, developing usable data for chronic fatigue syndrome, traditional chronic fatigue syndrome.

Unidentified Analyst: Understood. And then just one more question from us, so in regards to your early access program for Ampligen in the Erasmus Medical Center, how many patients have been included in this program so far? And have you seen any additional data?

Thomas Equels: Yes, we’re over 50. How many patients exactly, Chris?

Christopher McAleer: I believe the number is 57, but please don’t quote me on that exact.

Thomas Equels: Yes, it’s over 50 for sure. And Dr. McAleer will talk to the data, but it’s been increasingly positive. So the more subjects we’ve had, the better the survival — progression-free survival and overall survival data gets. Chris, do you want to talk about that a little bit?

Christopher McAleer: I’d be happy to. So if you want an update on that particular data, I believe on our website there is the presentation for — that I presented at the Marie Curie Sklodowska Symposium at Roswell Park. And in that presentation, there are a few slides on the updated data. And so the original 27 patients that were there showed considerable improvements in progression-free survival and overall survival. We included what I believe is an additional 30, but it might have been 29. It may be 56 patients. But regardless, it’s equivalent — essentially equivalent number of patients. And that second cohort of patients only confirm the original data that we had. And to that point, the overall survival short term and long term seem to actually improve with the addition of the patients over those historical controls.

And so with that additional data, it only makes me more confident that this trial, AMP-270 is going to come out to be exactly the way we thought. And I remind you that, that massive improvement in the EAP is with — also with patients with metastatic disease. I think when we localize — when we look at this, it just locally advanced cancer patients in AMP-270 it might be even better, but that’s just speculation.

Thomas Equels: And remember, the safety information as well as the data flowing from that early access program, was the basis for our application for orphan drug designations from both the United States FDA and Europe’s Medicines Agency. And those orphan drug designations, which look at none at the same level of scrutiny as a new drug application, but look at safety and efficacy as a part of the consideration, were both granted relatively rapidly by both agencies.

Christopher McAleer: And I also do want to point out that in that presentation, we looked at selection criteria for patients and those who have a CA99 less than 1,000, seemed to respond better where the overall survival improves by, I think, two to three months, when we select out that specific cohort of patients. And that has to do with progression and the intactness and also those who have a systemic immune inflammation index below 900 which points to their — the health of their immune system. And so typically, those patients with locally advanced pancreas cancer meet those criteria. So I think they’ll — goes to my previous statement that the AMP-270 might respond better, even better than what we have from the EAP. Q – Unidentified Analyst Great. Thanks for the answers and for taking in the questions.

Thomas Equels: Well, thank you very much for your interest.

Operator: Thank you. Our next question comes from the line of Ed Woo with Ascendiant Capital Markets. Please proceed with your question.

Edward Woo: Yes. Congratulations on the progress. My question is on Ampligen. Can you talk about your supply of it? And is there any need for you to manufacture any more of it anytime soon?

Thomas Equels: Well, we’re expanding our clinical programs, and we have Ampligen budgeted — in-stock budgeted for that clinical activity, but we are in the process of manufacturing more Ampligen. So we always want to have a sufficient reserve to allow for any kind of clinical contingency that might come up where we need additional drug and that process is underway.

Christopher McAleer: And to that end, Ed, we have over 16,000 units in-house, the AMP-270 trial is expected to use approximately 10,000 of those units. We shipped a pilot of 1,350 actually goes out tomorrow to do the first approximate year, we believe, at Erasmus Medical Center for AMP-270 and to do the Phase 1 of the DURIPANC Study. We expect that DURIPANC Study to go well, right, based on the EAP data and all the science behind it. So we expect the Phase 2 to transition rather rapidly, recruitment at Erasmus seems to go rather quickly. So based on the end of the Phase 2 study in long COVID that we currently have, and the trials that we have ongoing and the drug allotment that we have, we thought it pertinent to get another production run of Ampligen approximately somewhere between 9,000 and 10,000 vials, which is slated to fill and finish in December, early December.

Edward Woo: Great. As you manufacture this 10,000 vial lock, is the cost about the same as it was before? Has it gone up? Has it gone down?

Thomas Equels: Unfortunately, inflation has an even greater toll in our industry. So not only have clinical costs gone up and manufacturing costs have gone up as well. However, we are managing those expenses in a prudent manner. And we need to remember, too, that the manufacturing, well these are — it may sound like a lot of Ampligen, but this is not a mass production type of manufacturing. These are small batches of Ampligen, which cost a lot more to manufacture than it would cost if it were in mass production mode. The price of the Ampligen — the cost of the Ampligen would drop significantly if it were picked up by a company that was in a position to make large amounts of Ampligen.

Edward Woo: Great. Well, thanks for answering my questions and I wish you guys good luck. Thank you.

Thomas Equels: Well, thank you very much Ed.

Operator: Thank you. This concludes our question-and-answer session. I’ll turn the floor back to Mr. Equels for any final comments.

Thomas Equels: Well, as always, we are grateful for your time and your interest in AIM and in Ampligen. We’re very proud of our accomplishments and the accomplishments of our collaborators as we go forward. And on that foundation, we’ll continue to build progress through 2023. We are very much looking forward to pursuing and heightening this momentum in 2024, and providing — and this is perhaps the most important thing to us, providing hope and opportunity for patients who have unmet medical needs in these serious diseases. We look forward to working with our medical collaborators, our scientific collaborators and those universities that are so important to what we’re doing and creating long-term value for our stockholders. Thank you very much.

Operator: Thank you. This concludes today’s conference call. You may disconnect your lines at this time. Thank you for your participation.